In 2015, European Commissioner for Trade, Cecilia Malmström declared that ISDS was the most ‘toxic acronym in Europe’ referring to the Investment-to-State Settlement Dispute Mechanism (ISDS), that allows corporations to sue governments. TNI has played an instrumental role in turning this obscure mechanism into the core of public opposition to unjust trade deals, and directly helped prompt some significant reviews of trade and investment policy in Europe, Myanmar, Uruguay and the Philippines.
Goal (2011-2015): Move towards global architecture that puts public interests above investor rights by convincing governments to end, review or reject investor-to-state dispute settlement (ISDS) mechanisms that undermine democracy and regulation in the public interest.View
International trade is worth $10 million a minute – 25 times bigger than aid flows – but who benefits depends on how trade and investment rules are written. More than 419 regional trade agreements and 2610 investment agreements are already in force and many more are being negotiated. Multinational companies have a huge influence over negotiations, so many of these agreements grant corporations special privileges and impunity for human rights and environmental violations and roll back regulations that protect people and the environment. The costs are felt by many people whose jobs are outsourced, whose land and resources are ‘grabbed’ and whose environment is destroyed.
During 2015, investment protection and ISDS become hotly debated political issues in Europe and worldwide. Once seen as an obscure technical issue worked on by only a few, ISDS has now been taken up for advocacy by a growing number of international actors. TNI supports many of these networks with solid research, strategic advocacy, logistical support, advice and training.
TNI plays a particularly significant role in the European Seattle to Brussels (S2B) network, actively working in the Coordination Group, legally hosting the network and supporting its coordinators. TNI is also the host of the Dutch TTIP coalition and participates in the steering group of the Platform currently seeking a referendum on TTIP/CETA.
Within Europe, TNI co-organised two major trainings on ISDS for activists across Europe (March and November 2015) to build capacity among key organisations in most European capitals so people could lobby their own policy makers and engage the media. These networks were key to mobilising an incredible 3 million people to sign the European Citizens’ Initiative against TTIP. In the Netherlands, TNI worked with a coalition to gather 100,000 signatures, as well as co-organised a demonstration of over 7,000 people in October.
The massive public concern prompted politicians from across the political spectrum to come out against ISDS. Parliaments in the Netherlands, France, and Austria all adopted resolutions of concern on investment arbitration, with TNI publications referenced in many of the debates. At the European level, after many years of lobbying by TNI and others, one of the largest party blocs in the European Parliament, the Socialists and Democrats (S&Ds), also come out critically against ISDS.
Beyond Europe, a number of countries (Indonesia, Pakistan and South Africa) have also been emboldened to publicly oppose ISDS and start to terminate Bilateral Investment Treaties – often drawing on TNI expertise and under pressure from TNI partners.
International bodies have stepped in to add their voice to the groundswell. In October, Alfred de Zayas, a UN rapporteur to the Human Rights Council, after meeting with TNI and others called for the abolition of ISDS. UNCTAD urged countries worldwide to review their investment protection framework arguing “there is a pressing need for systematic reform of the international investment agreements (IIAs) regime to bring it in line with today’s sustainable development imperative”.
TNI’s long-term research and expertise on the issue has become deeply respected by activists, media and policy-makers alike. In 2015, we helped to broaden the movement and build support for the campaign through examining the ways ISDS would adversely affect public services, agrarian justice and a renewable energy transition.
TNI continued to put a spotlight on the small coterie of corporate lawyers benefiting from investment arbitration, through an exposé of the European Federation of Investment Lawyers (EFILA). Our trade and investment reports were downloaded 1947 times during 2015 and covered by 22 outlets including Volkskrant, Publico and Al Jazeera as well as featured in a prominent documentary by VPRO Tegenlicht in the Netherlands.
TNI outreach together with other civil society groups has been so successful that pro-ISDS advocates gathering in Ditchley, UK in November 2015 agreed that they were “losing the argument”. In the Netherlands, a poll showed that only 9% of Dutch voters think ISDS should be part of TTIP.
The unprecedented level of resistance against ISDS and the Transatlantic Trade and Investment Partnership forced the European Commission to acknowledge the legitimacy of public concerns. Working with our partners in the Fair Green and Global (FGG) alliance in the Netherlands, our pressure led Dutch Minister Ploumen to join five other member states in proposing reforms to ISDS. We also actively engaged Commission staff at meetings (March, July, November) and through public debates (November) and in correspondence.
As a result in November, the Commission announced a proposed Investment Court System (ICS) to replace ISDS in TTIP as well as in all ongoing and future EU investment negotiations. The reforms addressed some of the procedural problems in the investment arbitration process that TNI has highlighted, but was largely an attempt to rebrand ISDS as it allows corporations to continue to make claims for regulations that protect the public interest. TNI has continued to vigorously campaign for a complete rejection of ISDS/ICS in existing and future trade agreements.
Another partial step forward was made in June, when the European Commission asked Member States to terminate their intra-EU bilateral investment treaties. TNI had been pushing for this since 2012, drawing attention in a number of policy briefings to the ways it undermined other European goals, organising seminars in East Europe on the issue (Prague in 2012, Budapest, 2013) and lobbying the Commission’s Director General for the Internal Market.
“My Commission will not accept that the jurisdiction of courts in the EU Member States be limited by special regimes for investor-to-state disputes. The rule of law and the principle of equality before the law must also apply in this context.”
– Jean-Claude Juncker , President European Commission
As well as working at a European level, TNI also works closely with partners in developing countries worldwide to raise awareness of the impact of trade and investment agreements on sustainable development.
In Myanmar, TNI organised seminars with local civil society organisations, provided analysis and advice, and facilitated exchanges with experts in the issues from Asia. As a result, several significant Myanmar networks such as Land in Our Hands (LIOH), Myanmar Alliance for Transparency and Accountability (MATA) and Paung Ku developed joint policy positions against ISDS in the EU-Myanmar Investment Treaty and in Myanmar Investment Law and the issue started to receive coverage in local media. Consequently, the Myanmar government agreed to exclude ISDS in its draft National Investment Law, while the EU delegation in Myanmar agreed to further consultations.
In the Philippines, TNI worked closely with its partner Focus on the Global South and the Philippines’ trade coalition to actively engage the country’s Department of Trade and Industry on the issues of ISDS and Bilateral Investment Treaties. Three position papers on the social costs of ISDS were submitted to a roundtable consultation with the government and two policy papers on market access and fishing were also produced by Focus on the Global South. As a result of the pressure, the DTI has agreed to carry out an impact assessment of ISDS for the EU-Philippines FTA on top of an on-going BITS review process.
Finally, Uruguay publicly withdrew from the Trade in Services Agreement (TiSA) in September 2015 as a result of TNI partner REDES’ mobilisation and advocacy efforts. The Second International Seminar on Public Enterprises: State, Public Enterprises and Development, co-organised by TNI and Uruguay’s state-owned telecommunications company ANTEL in 2012, was one decisive moment that initially opened up the debate. REDES’ follow-up work, with the Uruguayan national trade union movement PIT-CNT, succeeded in organising a nation-wide debate – with widespread coverage in the media – carrying out advocacy with members of Parliament and high ranking officials in various ministries and state-owned enterprises. The collective concern within the Vasquez administration and the governing party led to the vote in September where a large majority in Congress voted to oppose the continuation of Uruguay’s participation in TiSA negotiations and to pass that recommendation to Uruguay’s President Vasquez.
Trade and Investment Project Coordinator
Economic Justice Programme Coordinator
Research Associate (climate change as cross-cutting issue)
Hilde van der Pas
Economic Justice Programme Assistant
Chair of the Board of TNI